Zephyrnet Logo

Generative Data Intelligence

Biotechnology

Biopharma sector still growing despite layoff wave, Stifel report finds

Republished By Plato
Republished By Plato

Date:

Views: 47

Dive Brief:

  • The number of biopharmaceutical jobs is growing despite the sector’s market turbulence, but the gains are concentrated to larger companies, according to a new analysis from the investment bank Stifel.
  • The data, published in the firm’s latest biotech update, show that employment at large pharmaceutical and biotech companies has climbed since early 2021, and that the ranks of mid-sized drugmakers are increasing fastest of all. Job totals among smaller companies are down, however.
  • The findings, based on multi-year analysis of 78 biotech and pharma companies, were published at a time when news of job cuts have become commonplace in the industry. Stifel said the number of layoff announcements surged 81% over the first seven months of 2023 compared to the same period a year prior. Since last week, Pfizer, BioNTech and Sage Therapeutics have warned of possible cost cuts in the near future.

Dive Insight:

Though the sharp slide in stock prices that sank the biotech sector in 2021 and 2022 has leveled off this year, the effects are still being felt.

Initial public offerings remain difficult to pull off, despite a few positive signs. Early-stage fundraising is on pace to fall 40% in 2023, forcing some startups to shut down and others to reevaluate their business plans.

Many public companies are struggling, too. According to Stifel’s report, 180 biotechs had a market value less than their cash holdings as of last Friday, the most in about three months. Nearly 100 drugmakers have laid off staff so far this year, including some large companies like Amgen, according to data compiled by BioPharma Dive.

Still, Stifel found reason for optimism amid the shakeout. The bank’s report — assembled from a sampling of small and large companies via LinkedIn — claims the sector as a whole is actually “adding” and “not shedding employees, on balance,” suggesting that those laid off are quickly finding new opportunities elsewhere.

The employee count in its survey — which included 13 large pharmaceutical companies and large biotechs like Amgen, Biogen and Vertex — climbed from about 920,000 in February 2021 to just over 1 million this month. Job growth accelerated in the last six months in particular, with the sector adding “more employees than in any half-year period” since the firm began tracking, the report said. (Biogen, though, recently disclosed plans to cut 1,000 jobs, or about 11% of its workforce, by 2025.)

Yet some parts of the sector are faring better than others. The workforces at large pharmaceutical companies, for example, expanded by about 12% since February 2021. Pfizer, Roche and Novo Nordisk have grown the most lately, each adding more than 7,000 workers in the last year, according to the report.

Over that same period, the workforce of smaller biotechs — a 19-company list that included gene therapy developer Bluebird Bio and rare disease drugmaker Agios Pharmaceuticals — fell by 24%.

On an industry podcast last week, Tim Opler, a managing director in Stifel’s global healthcare group, said the findings show “employment growth is accelerating.”

“When you look at the big picture, small cap biotech isn’t that big of a source of employment in our industry,” he said. Opler instead pointed to the area of fastest job growth in biotech, mid-sized drugmakers, a group that included schizophrenia drugmaker Karuna Therapeutics as well as gene editing biotechs Intellia Therapeutics and Beam Therapeutics.

That group has added 73% to their employment base since February 2021, Opler said on the podcast.

“We’re in a growth industry,” he said, and “it really has not changed that much in the last year or so.”

spot_img

Latest Intelligence

spot_img

Copyright @ 2024 Plato Technologies Inc.